Carvana Stock Spikes as Investors Bets on Growing Used Car Demand

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An 8-story car vending machine, operated by the online used car dealer Carvana.


Mark Ralston/AFP via Getty Images

Investors continue to bid up stocks of used car sellers, amid growing signs of consumer demand. On Tuesday, Piper Sandler analyst Alexander Potter repeated his Overweight ratings on both

Carvana

and

Vroom,

boosting estimates for both companies.

Potter raised his target price on Carvana (ticker: CVNA) shares to $265 from $209, while adjusting his Vroom (VRM) target to $81 from $82. He sharply reduced projected losses for both companies for this year and next, and sees booming demand for online used car sales.

“We are responding to a barrage of data points, all of which suggest strong Q3 fundamentals, as well as better prospects for long-term share gains,” Potter writes in a research note. The analyst notes that at a Piper virtual event last week, both Carvana and Shift

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